Landlords have seen tenants in buy to let rent arrears fall by more than a third in the past 12 months, according to new research.
Tenants in severe arrears – those two months or more behind with their rents – has dropped from 105,000 in the first quarter of 2013 to 68,000 in the first three months of this year, says the LSL Property Services Tenant Arrears Tracker.
The firm runs letting agencies Your Move and Reeds Rains.
Tenants with severer rent arrears comprise 1.4% of all buy to let tenancies.
“Problems with personal finances are easing across the country,” said Paul Jardine, director and receiver at Templeton LPA, the LSL Property Services firm producing the statistics.
“Thousands of tenants are getting back on top of the money worries and expect an easier year this year than they have in many years since the credit crisis.”
The survey also revealed 6.9% of all rent was late or unpaid in February – compared with 7.4% in January and 9.7% in December.
“We believe a clear trend is emerging,” said Jardine. “With three successive quarters showing a sharp annual improvement in the number of such cases, the chance of tenants falling so far behind is receding. Slowly but surely a brighter economic picture is breaking through the gloom and is starting to make a real difference to purse strings across the country.”
Improving buy to let rent arrears are also impacting on evictions, the study found.
The number of tenants facing court eviction orders dropped in the final three months of 2013 to 30,324 tenants facing eviction notices. The figure decreased 3.4% from 31,380 in the third quarter of 2013.
“Tenant finances have seen a serious change of direction in the last twelve months. Previously, tenants absorbed a huge shock to personal budgets by mostly scrimping and saving. But now we’re starting to see real progress driven by what may become a significant pick up in wages,” said Jardine.